The case against living in the Bay Area, for ambitious tech people(newsletter.goodtechthings.com)
newsletter.goodtechthings.com
The case against living in the Bay Area, for ambitious tech people
https://newsletter.goodtechthings.com/p/the-case-against-living-in-the-bay
58 comments
At Google, HR has dictated to our team "no Bay-area hiring" for over a year now. It seems at least one company agrees with "There’s no surplus value in hiring in the Bay Area".
Google is also a failing company though. Not sure they are a good role model when it comes to hiring.
Look, if you want to hire the smartest, most innovative people in the world, you go to San Francisco. Period, end of statement.
But FAANG are no longer hiring the smartest, most innovative people in the world. Those people served their purpose, and were instrumental in making FAANG huge. FAANG stays huge by keeping the lights on at minimal cost. That takes legions of schlubs to maintain and incrementally improve their massive infrastructure... and those are more plentifully, and cheaply, found elsewhere.
But FAANG are no longer hiring the smartest, most innovative people in the world. Those people served their purpose, and were instrumental in making FAANG huge. FAANG stays huge by keeping the lights on at minimal cost. That takes legions of schlubs to maintain and incrementally improve their massive infrastructure... and those are more plentifully, and cheaply, found elsewhere.
What's HR'a rationale?
The engineering pool is broad enough (or the Bay Area shallow enough) that they can hire everywhere and get the same quality of engineer.
Since the wages paid are based on _local_ prevailing wage, and the Bay Area has the highest prevailing wage, Google will get cheaper engineers.
This also avoids the US immigration system, which is a terrible, expensive, stress inducing (performance sapping) thing for staff (and businesses) to interact with.
Finally, by distributing engineers to other countries, they counter some of the political "They're not _local_" arguments being made in various countries.
Since the wages paid are based on _local_ prevailing wage, and the Bay Area has the highest prevailing wage, Google will get cheaper engineers.
This also avoids the US immigration system, which is a terrible, expensive, stress inducing (performance sapping) thing for staff (and businesses) to interact with.
Finally, by distributing engineers to other countries, they counter some of the political "They're not _local_" arguments being made in various countries.
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Engineers are increasingly commoditized, and businesses like google no longer need outlier talent
Google doesn't do anything interesting anymore.
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There are obvious exceptions to everything. But I’ve lived in Atlanta, Orlando, SF and Seattle.
Moving to SF was a career multiplier. I instantly doubled my salary.
Now, I’m earning 2-5x more than my peers (that were more senior than me) that chose to live in those cities.
Walmart was started in Arkansas. Warren Buffet famously lives in Nebraska.
But the Tier 1 cities create more wealth for more people than Tier 2 or 3 cities.
Moving to SF was a career multiplier. I instantly doubled my salary.
Now, I’m earning 2-5x more than my peers (that were more senior than me) that chose to live in those cities.
Walmart was started in Arkansas. Warren Buffet famously lives in Nebraska.
But the Tier 1 cities create more wealth for more people than Tier 2 or 3 cities.
How much more are you spending (on non-avoidable cost of living stuff) now that you live in SF, though?
If I hypothetically doubled my salary _and_ my expenses, that hardly seems worth it. Although NorCal is gorgeous.
If I hypothetically doubled my salary _and_ my expenses, that hardly seems worth it. Although NorCal is gorgeous.
Pretty much if you ever double your salary you will come out ahead as everything else doesn't double. (And even if it does, your savings also doubled so you can retire to a lower cost of living and come out ahead).
If you go from say 120k to 240k in salary your housing may go from say 1k (12k/year) to 3k (36k/year) but at the end of the year 120k-12k is 108k while 240k-36k is 204 which is a net gain of 96k!
Of course you still need to eat and stuff but when you check out the "Regional Price Parity" [1] you'll see that nowhere do things actually become twice as expensive. So you're really getting a 2x boost in salary in exchange for a 1.3x increase in expenses.
[1]: https://www.bea.gov/data/prices-inflation/regional-price-par...
If you go from say 120k to 240k in salary your housing may go from say 1k (12k/year) to 3k (36k/year) but at the end of the year 120k-12k is 108k while 240k-36k is 204 which is a net gain of 96k!
Of course you still need to eat and stuff but when you check out the "Regional Price Parity" [1] you'll see that nowhere do things actually become twice as expensive. So you're really getting a 2x boost in salary in exchange for a 1.3x increase in expenses.
[1]: https://www.bea.gov/data/prices-inflation/regional-price-par...
your salary is probably not doubling fully post-tax though
YMMV.
At least for me since the compensation tripled, the salary effectively doubled post-tax.
Given that the BLS puts the median programmer at 99k/yr [1] I think your salary will double if you go to the bay area.
[1]: https://www.bls.gov/oes/2023/may/oes151251.htm
At least for me since the compensation tripled, the salary effectively doubled post-tax.
Given that the BLS puts the median programmer at 99k/yr [1] I think your salary will double if you go to the bay area.
[1]: https://www.bls.gov/oes/2023/may/oes151251.htm
> If I hypothetically doubled my salary _and_ my expenses, that hardly seems worth it. Although NorCal is gorgeous.
All else being equal, the improvements in other non-financial areas (chances to grow social life, many more attractions, etc) should make up for it.
The savings gap hopefully should widen as well (unless it's a deficit, in which case, cut expenses).
All else being equal, the improvements in other non-financial areas (chances to grow social life, many more attractions, etc) should make up for it.
The savings gap hopefully should widen as well (unless it's a deficit, in which case, cut expenses).
Altho I want to state the perhaps obvious that different big cities have very different subcultures.
Portland vs. SF vs. Nashville vs. NYC.
I would not limit yourself to just one specific big city.
Portland vs. SF vs. Nashville vs. NYC.
I would not limit yourself to just one specific big city.
In Atlanta, I earned $70k/yr ($4k/mo after taxes). I saved about $2k/mo
When I moved to SF, I earned $130k/yr ($6k/mo after taxes). I saved about $3k/mo
You can't expect the same quality of life as you did in the lower cost cities, but it is much easier to save way more money when you have a high income, than a low income.
You can't expect the same quality of life as you did in the lower cost cities, but it is much easier to save way more money when you have a high income, than a low income.
I would wager that you still end up with more disposable income in the end if you're single. I only decided SF or the rest of Bay Area wasn't financially worthwhile when I wanted to start a family.
>Now, I’m earning 2-5x more than my peers (that were more senior than me) that chose to live in those cities.
Salary or takehome? Sure, your net in SF will be higher than Orlando or London, but looking at resources such as levels.fyi, internal salary sharing sites at large companies, etc. the math for Seattle comp with no state income tax is pretty close to bay area minus tax.
Salary or takehome? Sure, your net in SF will be higher than Orlando or London, but looking at resources such as levels.fyi, internal salary sharing sites at large companies, etc. the math for Seattle comp with no state income tax is pretty close to bay area minus tax.
Seattle has enforceable (and readily abused) non-compete and also virtually non-existent startup scene
In practice, no, the non competes are never enforced, and if the goal is to brag about high compensation startups don't matter.
Amazon has filed numerous lawsuits for this - it’s well documented. I think there’s some some sort of ban for non-competes on w2s under $120k now (which doesn’t really help tech workers), but otherwise you’re wrong.
To your second point - there are always a bunch of well capitalized startups in the valley. Today it’s AI, before it was crypto, etc. These startups pay really really well when compared nationally. You dont have to get into 500k+ faang salaries to win against other locales
On top of that there are many more private companies that also pay good base + offer liquidity events for employees. Again - orders of magnitude more than seattle, austin or even nyc
To your second point - there are always a bunch of well capitalized startups in the valley. Today it’s AI, before it was crypto, etc. These startups pay really really well when compared nationally. You dont have to get into 500k+ faang salaries to win against other locales
On top of that there are many more private companies that also pay good base + offer liquidity events for employees. Again - orders of magnitude more than seattle, austin or even nyc
Startup equity should be assumed to have a value of 0, which statistically it does. I've never seen one be competitive on actual hard currency compensation - even the hot ones. And that's before valuing your time per hour worked.
I'd love to see examples of Amazon trying to enforce noncompetes at levels lower than VP, because I've never seen it. Folks move to direct competitors all the time - AWS to Azure or Oracle, etc.
I'd love to see examples of Amazon trying to enforce noncompetes at levels lower than VP, because I've never seen it. Folks move to direct competitors all the time - AWS to Azure or Oracle, etc.
> I'd love to see examples of Amazon trying to enforce noncompetes at levels lower than VP, because I've never seen it.
Easy[0]. I also know a few cases where a 3rd company refused to extend an offer due to legal flagging it
[0] - https://news.ycombinator.com/item?id=7975428
> I've never seen one be competitive on actual hard currency compensation - even the hot ones
OpenAI famously was pretty generous. It’s all public data now due to lawsuits
Easy[0]. I also know a few cases where a 3rd company refused to extend an offer due to legal flagging it
[0] - https://news.ycombinator.com/item?id=7975428
> I've never seen one be competitive on actual hard currency compensation - even the hot ones
OpenAI famously was pretty generous. It’s all public data now due to lawsuits
Take home. Salary seems to be 1.5-2x Orlando peers.
I prefer Seattle over SF. In Seattle, I can own a car and have a safe place to park it.
I prefer Seattle over SF. In Seattle, I can own a car and have a safe place to park it.
Take-home pay is indeed higher in the bay but unless already had a family, that take-home pay is worthless in what is without a doubt the most socially dull major metro in the US.
Take-home pay isn't higher if you consider taxes.
I go on way more road trips and hikes than what San Francisco ever permitted. While SF has a few good hikes, it expensive to own a car (parking, insurance, break ins, ticketing).
Seattle has access to Canada, islands, mountains, snow skiing, and boating.
I go on way more road trips and hikes than what San Francisco ever permitted. While SF has a few good hikes, it expensive to own a car (parking, insurance, break ins, ticketing).
Seattle has access to Canada, islands, mountains, snow skiing, and boating.
Sounds like an exaggeration, cause there must be plenty of worse places. But yeah Silicon Valley rubbed me the wrong way.
Why is that? Monoculture I assume? Everyone works in tech so you never meet interesting people who work in completely different fields?
It's something else that I can't easily explain. I'm a remote SWE now, and I go to a local office I'm not assigned to. Just in that tech circle, I have way more friends at work here than I did in Silicon Valley, where I saw my team and department each day in-office. I was just as friendly and outgoing in both places, and similar place in my life (married).
There are a lot of good things about living in Silicon Valley, so it's a bit annoying when people take all that for granted. I do miss being able to bike everywhere I needed in Mountain View. But I was happier after we left.
There are a lot of good things about living in Silicon Valley, so it's a bit annoying when people take all that for granted. I do miss being able to bike everywhere I needed in Mountain View. But I was happier after we left.
The problems are roughly:
- Monoculture
- Generally risk-averse and cliquish population whose primary concern is (understandably) survival and accumulating the money needed to live a normal middle class life and are drawn to the “peaceful” atmosphere of the region (a word you’ll hear especially frequently)
- Terrible urban planning and poor density for socialization: sprawling suburbia, lifeless downtown cores, everyone is far away from each other and as a result of the grueling commutes, few are willing to spontaneously hang out after work
It’s a toxic mix that leads to a social death spiral.
It’s a toxic mix that leads to a social death spiral.
The downtown areas of Mountain View, Cupertino, San Jose, Los Altos, Saratoga, and Palo Alto are pretty lively (sorry Sunnyvale). And most of America is suburbia, but people are still friendlier there.
I had the issue with people not wanting to hang out after work, but it wasn't due to commute distance.
Continental allergies destroy talent. This applies to much of the east coast as well as they’re downstream of the continent.
I agree with much of this post, but there is a reason the areas with the highest intellectual output are on the coast.
I just moved from Dallas to the bay. Going from multiple allergy medicines a day and a persistent brain fog from ragweed and mountain cedar to none. Going from keeping windows closed with co2 levels spiking to levels that effect cognition to living with windows open and breathing fresh air. There is a reason Texas is where dying companies relocate to.
I agree with much of this post, but there is a reason the areas with the highest intellectual output are on the coast.
I just moved from Dallas to the bay. Going from multiple allergy medicines a day and a persistent brain fog from ragweed and mountain cedar to none. Going from keeping windows closed with co2 levels spiking to levels that effect cognition to living with windows open and breathing fresh air. There is a reason Texas is where dying companies relocate to.
That's an interesting view. I always thought the coast cities had naval business and trade and they are simply still running off those initial successes. But your point is also very interesting. Do you have any data around it?
Outside of wanting to work at some tier 1 startup like OpenAI or being a CTO/CISO, I see no financial incentive to live/work in a metro area like the Bay area. I'd like to see some comparison between a remote worker getting a "Good" tech salary (mid 200s-low 300s) in low CoL area and some Netflix engineer in Los Gatos making $750k year but paying the high taxes/housing/food/etc.
In no way your cost of living in Los Gatos would be higher than the delta of 450k, even post tax. Are you serious? Bay Area is still an absolute best place to create savings equivalent to generational wealth in many other places. Also, Los Gatos is no SF, a lovely place.
If anything, it's a case for building more housing and public transit. Either this happens or it'll continue bleeding jobs to other metros
Having corporations bring jobs here with the current housing situation is kind of irresponsible. In the long run, if they spent some %age of money on yimby causes, they could save money by reducing the cost of living
Having corporations bring jobs here with the current housing situation is kind of irresponsible. In the long run, if they spent some %age of money on yimby causes, they could save money by reducing the cost of living
This article conflates the notion of being "in tech" with being a CEO for some reason. The vast majority of people "in tech" will be workers, not CEOs. For those people, a statement like "There’s no surplus value in hiring in the Bay Area" should sound like a good thing.
The TV show Silicon Valley lampooned all these ideas a decade ago. The weird thing I’ve noticed is that when Bay Area tech people watch that show, they don’t seem to understand that they’re being made fun of. They think they’re being celebrated. That’s how thick the bubble is.
I've never met a person who didn't understand that this show is satire. Every single tech person I've talked to about Silicon Valley thinks it's funny because of how plausible and yet ridiculous it all is, and because of all the totally accurate details scattered throughout—from golden handcuffs / resting & vesting, down to minor things like which drinks were stocked in the show's office fridges. And I lived in the Bay Area during its entire run, so most of my network is current/former Bay Area tech people.
I've never met a person who didn't understand that this show is satire. Every single tech person I've talked to about Silicon Valley thinks it's funny because of how plausible and yet ridiculous it all is, and because of all the totally accurate details scattered throughout—from golden handcuffs / resting & vesting, down to minor things like which drinks were stocked in the show's office fridges. And I lived in the Bay Area during its entire run, so most of my network is current/former Bay Area tech people.
Everyone I knew who watched the old Office Space movie thought it was funny; I never liked it because it was too much like real life (at the time). Same with the TV show The Office.
Big Bang Theory was all the rage when I was working at CERN. I know exactly what you mean.
About the "tautological" part: Economic feedback loops are natural and don't diminish from the value of being in the area. At one point I went there to open doors that probably wouldn't have been reachable otherwise. Silicon Valley isn't a perfect circle either, because it wasn't just created from nowhere decades ago.
The only reason I don't live there anymore is because I already got the "in" I needed, I think remoteness actually works best if you're ambitious (provided you visit occasionally), and because I really didn't like living there. Idc if someone takes the last part as an excuse, my work speaks for itself.
The only reason I don't live there anymore is because I already got the "in" I needed, I think remoteness actually works best if you're ambitious (provided you visit occasionally), and because I really didn't like living there. Idc if someone takes the last part as an excuse, my work speaks for itself.
As a UK national I would love to move to the US for better opportunities and weather. Getting a visa seems next to impossible, short of marrying an American. I probably missed my chance in the pre Covid tech boom.
I dunno, if you've made enough money to enjoy it (like, say you've been in Bay Area "Tech" for a few years), London seems like a cooler place to be. You lose on dollars and cents, but I'd think you'd win on lifestyle. I don't just mean "work-life balance"; I mean it's a nicer, more interesting, more stimulating place to be.
The boom _during_ Covid has been crazy, but I think it's still possible to get a FAANG job that will get you to the US. The other route would be joining a FAANG in the UK and then changing teams after 1-2 years.
I’m glad I have no ambition, I guess.